Three Cities, Three Tales of Tenuous Transit Plans

On Friday, a few weeks after they declared the project kaput, government bigwigs in Michigan stood together to announce that plans for the M1 light-rail in Detroit were back on. Flanking the politicos were a handful of the city's business leaders, the philanthropic backers of the M1 project. The WSJrightly calls the new plan "déjà vu" for them: the scaled back plan, 3.4 miles of rail circling downtown, was what financial backers and city officials agreed to over three years ago.

Matt Cullen, the President and COO of Rock Ventures LLC, and volunteer chief of the M1 coalition, explained that the additional plans, which nearly tripled the distance and cost, were a bit frivolous. "We overshot our landing," he told me. "We need to go back to the original plan that everyone endorsed."

With its fits and starts, its frustrating uncertainty, the Detroit rail is a good microcosm of transportation policy across the nation in recent years. And yet, at the same time, with its almost entire reliance on private benefactors, the city's plan is utterly unique. While Cullen and his coalition finalize their pitch, two other metropolitan areas are wrestling with projects more emblematic of how urban regions try to get transit off the ground. And each has its own considerable hurdles.

Los Angeles: In 2008, the county of angels passed Measure R, a ballot initiative that hiked sales taxes up by half a percent, over 30 years, to fund an ambitious $40 billion transit program. Since then, Mayor Villaraigosa has been on an aggressive prowl to speed the project up. He has pushed plans to use $800 million of the funds to repair the city's dilapidated streets, over two or three years, and pitched his 30-10 initiative, a snazzy plan to compress the dozen city projects into a decade's time.

In so doing, the Mayor has epitomized one tactic a city can take: nudge Washington hard. He has not been shy about lobbying Congress to send funds and lower borrowing rate for the projects---a plan that makes sense in economic theory, but has no political feet whatsoever. He keeps coming back to town empty-handed. Last week, a Democratic Assemblyman offered an alternative to the D.C. tactic: a ballot measure to extend the life of Measure R, whose economic potential is already downgraded by $4 billion (economy and all), by at least a decade. It would go up before county voters in November.

Villaraigosa's ambition is commendable, but he's pinned it to a stingy Congress. Now much of the plan's fate turns on whether voters in the sprawling county will hike a regressive tax, already one of the highest in the state, for another spell.

Atlanta: For its much smaller ($6.14 billion)---yet not insignificant---transportation overhaul, metropolitan Atlanta is planning a referendum to fund the project, using a larger sales tax (1%) over a shorter period (10 years) than L.A.'s. While the referendum sidestepped Villaraigosa's reliance on Federal support, it has some definitive hurdles at home:

Any cooperation between transit agencies, however tentative, would be a first step toward regional mass transit that would have been unthinkable here years ago, and it would lay the groundwork for possible future consolidation.

Sister legislation under development could also allow MARTA [Metropolitan Atlanta Rapid Transit Authority] to run trains beyond the borders of Fulton and DeKalb counties for the first time since the agency’s formation. Some Fulton and DeKalb county taxpayer advocates say voters won’t support the summer transportation vote without regional mass transit legislation — while opponents say the legislation may undermine the vote.

Clearly, there are a wealth of political issues at play here---assertive unions, flamboyant Tea Partiers, cross-cutting state and city legislators. (The Republican Governor will outline his vision for the referendum this morning.) But a real challenge for the transit plan, one that spans 10 counties, is its very intentional regionalism. The approach, meant to govern with a broad metropolitan region in mind---in this case, packing multiple transit bodies under one roof---is steadily becoming more popular. Influential groups like the Brookings Institute are pushing its merits.

But the fiscal benefits of regionalism are not always apparent. And in a major economic plan like this, people from different spots in and around Atlanta, politics aside, will naturally have wildly divergent ideas about where their tax dollars should go. (One mostly suburban county has drawn a line in the sand.) Yonah Freemark lays out some of the details of the referendum thus far, a plan that, by wedding itself to regionalism, may sacrifice the economic needs of the central city.

Detroit: In some respects, the Motor City is confronting a similar regional question. This morning, Matt Sledge reported that the future of the project, downgraded, he reports, to a "streetcar," hinges on these issues. The Obama Administration wants it to fit into a "regional focus." Cullen told me that extending the line to the suburbs is critical---as a way to send city resident out there for work, and vice versa.

But an expansive approach may not be best for the city. If it's simply a streetcar for the city, that isn't such a bad thing economically. Freemark, who is, again, the best source for analysis of the plan, points out that the employment and residential density in the central Woodward corridor, the 1/2 mile area the smaller rail would surround, is the key development target for the city:

Unlike L.A. and Atlanta, which both thickened, then sprawled, Detroit has been spread thin. Private industry cheerleaders there like to praise the transit plan as an ingredient for the city's growth, a tad naively. A more realistic goal for the transit system is to contain the city, to bring its residents together with more speed and ease.

Of the three cities, Detroit may actually be, oddly enough, the one most likely to push its transit plan through. Unfortunately, its model is hardly replicable. Freemark calls the M1 backers "investors," but that's a misnomer. They are, Cullen assured me, pure philanthropists---they won't see a dime back of the projected $100 million raised for the project. (They will get dibs on naming rights for stations, he said. And the operating costs for the rail will be paid, in part, by tax assessment increases that are surely motivating downtown business leaders.)

Instead, Cullen said, the M1 backers are "people whose heart and soul are with the city of Detroit." In some sense, the philanthropists are shareholders of the city, intent on seeing some amenities emerge to balance the city's growing liabilities. Cullen admitted the city faces structural financial problems. But the former GM veteran cautioned against reckless austerity in dealing with Detroit's finances, outlining an approach comparable to the rebound of the big three automakers. "You can't win that war by just cut, cut, cut," he said.

I watch city things. For the past year, I tracked municipal finance and urban economics in the U.S. Now, based in Bangalore, I will focus on the economic opportunities and pratfalls of cities across India and throughout Asia. I co-founded City Ledes, an urban policy newslet...